Saturday, November 29, 2008

My Investment Portfolio (November 2008)

This month had not been as volatile as last month, but nevertheless, stock markets around the world still experienced higher volatility than normal. For my portfolio, two main corporate actions had been undertaken successfully. Datacraft Asia had been taken private successfully and RTO of Eng Wah Organization had been approved. Also, distributions from various REITs and shipping trusts had been welcome to me as I continue to re-invest those distributions back into the market.

New addition in my top 30 holdings this month include MTQ Corp, which I have added a bit lately on price weakness. MTQ is an interesting company which offers Engineering services to the oil and gas industry. It had a long profitable track record, good management and excellent cash flow. A re-entry of Sing Investment and Finance into my top 30 holdings is because of the presence of a last traded price for this thinly traded company. But I still maintain my preference of finance companies over banks as it is much easier to analyze their accounts.

As we are approaching year end, markets seem to have lower volatility as participants might be preparing to go on holidays instead of trading the stock market. Having said that, there is still opportunity to buy some stocks in December if one is patient enough. I will definitely be making some purchases in December and intend to end the year with some "Christmas shopping" in the stock market. :)

My S'pore Stock Portfolio - Top Holdings, cash investment only (correct as at 30 November

Top 30 Holdings (Sing$ Denominated shares)
1. Raffles Education Corp
2. SGX
3. F&N
4. Hersing
5. Noble Group
7. ComfortDelgro
8. Jardine C&C
9. SembCorp Marine
10. Hong Leong Finance
11. CapitaMall Trust
12. Parkway Holdings
13. Straits Trading
14. Singapore Food Industries
15. SBS Transit
16. SMRT
17. Cosco Corp
18. Viz Branz
19. Cerebos Pacific
20. CapitaLand
21. Food Empire
22. SingTel
23. Ascendas India Trust
24. Wheelock Properties
25. MTQ Corp
26. Keppel Corp
27. CitySpring Intrastructure Trust
28. Sing Investment and Finance
29. SPH
30. ST Engineering

Top 5 Holdings (US$ Denominated shares)

1. Jardine Strategic
2. Dairy Farm
3. Hong Kong Land
4. Jardine Matheson
5. Mandarin Oriental

Top Holdings (HK$ Denominated shares)
1. Tan Chong International
2. Fortune REIT

Top Holding (Aust$ Denominated shares)
1. AV Jennings

Top 5 Holdings (CPF OA investment)
2. CapitaMall Trust
3. Keppel Corp
5. Eng Wah Organization

My Hong Kong Stock Portfolio (listed on SEHK)
1. Peace Mark Holdings

My Unlisted Company Portfolio
1. JK Tech Investment
2. Automated Touchstone Machines Ltd
3. Iconic Global Limited
4. Greatronic Limited

My Unit Trust Portfolio:



Blogger cif5000 said...

Hi ghchua,

Can you share your thoughts about Hersing?

WHERE is the value?

10:25 PM  
Blogger donmihaihai said...

Hi ghchua,

I have a selfish request.

Is it possible that you post addition categories in your monthly review? In categories like(or something similar) :
1) Bankruptcy/- 100%
2) Down by 80%(or 90%).
3) List of stock gain/loss due privatisation.

While I don't want to know your portfolio value or the total value of 1) & 2) but is it possible that you also provide 1) & 2) in percentage on total stocks you owned. The reason I put down >80% is that either stock is purchase too expensive(unlikely for a person who buy cheap) or the operation of the company in deep troubles and unable to come back(some company don’t just die but keep dragging for years).

I am interested in 1) survivorship of company as you hold hundreds and for long term without selling and 2) casualty rate as diversification is the main focus of your portfolio and involvement of some skill a.k.a buying cheap.

Another reason for this request is accountability. This is your portfolio and you do not need to report to anyone but I am curious on the other side of your portfolio.

Many thanks.

5:41 AM  
Blogger ghchua said...

Hi cif5000,

Hersing's fortunes is tied with real estate brokerage business (i.e. ERA), though it have other growth business like financial services (Western Union) and storage hub.

Value in Hersing is difficult to see during current bad times, when its real estate business will suffer a big drop in profits. It is actually in a similar situation a few years back when I picked up the stock at cheap level of below 10cts. The dividends received throughout the years plus various bonus issues had in fact meant that those shares that I held in Hersing are basically free shares. Which means, I have already got back all my investment outlay via dividends throughout the past few years from Hersing.

I didn't add onto Hersing since a few years back because the previous few years had been property boom and valuation is not right. But maybe now it is a good time to take a look at it again, but most possibly I won't be adding since I don't want to overexpose myself in one counter.

But its chairman Harry Chua is passionate about this business which I think is very important for it to ride through these tough times.

6:59 PM  
Blogger ghchua said...

Hi donmihaihai,

For 1), so far, I haven't encountered any counter in my portfolio that had been bankrupted. Even if a company is bankrupt, it doesn't mean I would lose 100% in that company as I might have received some dividends along the way. So, I dunno whether it is a good indicator by looking at this category.

Having said that, there are 3 companies in my portfolio of around 650 stocks that had been delisted without any delisting offer. They have been listed under "My Unlisted Company Portfolio". These are mostly companies which are in trouble and had to sell off all their existing business and pay off their creditors. They have no business left and SGX forced them to delist. I dunno whether they will come back again.

For 2), it might be difficult for me to track as I might have bought the same stock at different times. The average cost must be taken into consideration if I wish to compute 2). Also, I have to take corporate actions like dividends, stock spilt, bonus issues etc into consideration.

For 3), it is quite easy to track as I mentioned about privatisation quite often in my postings. But to compute the exact gain/loss, I have to take into account the dividends received throughout the years, bonus issues/stock spilt, dividend re-investment via scrip dividend scheme etc. As you can see, it is quite an effort trying to dig out all these past information. And for the case of Datacraft, I also have to remember the US$/Sing$ exchange rate when I bought that stock and when I bank in their cheque, since it is denominated in US$.

And after doing the above, one must still understand that my portfolio is not an equal weightage one. Some stocks had been overweight, some are underweight. So, numbers alone might not tell you the whole story.

The main idea of me having this diversified portfolio is to spare me the headache of following companies closly and doing buy/sell stocks and tracking frequently. Therefore, I am comfortable of what I am doing currently. If I want to compute some numbers, I would have to make sure that I do it accurately, otherwise I would have mislead my readers and I am not comfortable with that.

7:24 PM  
Blogger cif5000 said...

Hi ghchua,

Thanks for the info.

ERA and Western Union caught my attention when I looked at Hersing. So I was wondering if you were interest more in ERA or WU.

The barrier of entry is definitely lower for real estate brokerage business, while remittance is also getting easier and easier in today's highly connected village. I remember ordering things from oversea and using WU to remit money. Nowadays, paypal is quite efficient. That means that margin will be eroded in the long run although volume increase (due to more international trade) could mitigate this lose.

It also came to me that the success (or failure) of WU in Singapore relies not only on the ability of the Hersing on a local scale, but also the international network that WU has. Also, the financial strength of WU is important because of (i) customers' confidence, and (ii) if WU fails, this segment of Hersing will also fail.

12:15 AM  
Blogger ghchua said...

Hi cif5000,

ERA still contibute the most turnover for Hersing, though the other two business are catching up.

Actually, ERA and WU doesn't interest me much nowadays. But its storage hub business does. The company had been growing this segment of the business, as can be seen by them purchasing 2 more self storage locations in 2008. An interesting feature that you can read to know more about this segment of their business:

HERSING: Singing the high note for its self-storage business

1:43 AM  
Blogger donmihaihai said...

Hi ghchua,

I am looking at survivorship so whether your calculation of portfolio/return include dividend or not is not important unless say stock A give a decent return just by dividends alone despite company become bankrupte.

I thought you have a good account for all transactions which include dividends, stock spilt, rights, etc.... I mean your top 30 holdings? Anyway even having a bottom 30 looks good for me.

Anyway it is your choice. And whatever thing in the net like blog already very much misleading..And I think what you put up for your investment portfolio is in fact on that direction already.

6:37 AM  
Blogger ghchua said...

Hi donmihaihai,

I don't keep good accounts of my transaction. My top 30 holdings keep on changing every month. What I do to generate the top 30 holdings in my blog is very simple. I just took out the email statement from CDP every month, do a sort on Excel and the list is out! :)

You see, it is so simple that I think many people would have laugh at me for generating the top 30 list.

Anyway, SGX had already tighten the rule on listed companies making losses every year. Most possibly, they will get warning from SGX and might face delisting in future if their results doesn't improve. Therefore, a good indication that you can get is "My Unlisted Company Portfolio" list which I would update every month. I don't think SGX will keep those "few cents" companies listed by dragging their feet and making losses every year.

6:19 PM  
Blogger Newbie_1980 said...

Hi ghchua,

Been following your posts in sgfund's forum and also your blog for a while and really appreciate hearing your views. I've only recently noticed that SPC is out of your top 30 Holdings since Oct. Indeed, market conditions have proven challenging for SPC, is that the reason why its out of your port or would there be something else that I may have missed?

7:38 PM  
Blogger ghchua said...

Hi Newbie_1980,

Thanks for visiting my blog! Yes, SPC dropped out of my top 30 list because its share price had fallen more than the other top holdings in my portfolio.

4:46 AM  
Blogger Unknown said...

Since you have so many stocks and you say that you don't have time to analyze each and every stock, you should have just bought the STI ETF.

3:15 AM  
Blogger ghchua said...

Hi Wing Keet,

Thanks for visiting my blog!

STI ETF is not diversified enough. It only contains blue chip counters, and doesn't include most of the mid-cap and small cap stocks.

9:03 PM  

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A self-directed investor, looking to invest for retirement needs and bypass all those expensive financial planners/insurance agents. Investing is fun, profitable or most important of all, knowledge gained is useful for the rest of your life!

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